Leeds among UK’s top five cities for attracting Foreign Direct Investment

Meanwhile, the Yorkshire and the Humber region secured 52 FDI projects in 2024, representing a significant 53% year-on-year uptick from a total of 34 in 2023. This was in contrast to the national figures, which indicated a 13% fall in total FDI projects across the UK compared with 2023.

The region’s increase in project numbers also saw their share of UK FDI projects almost double, from 3.5% in 2023 to 6.1% in 2024. Overall, Yorkshire and the Humber was the UK’s sixth-best-performing region in the UK for attracting FDI projects in 2024.

As well as the increase in overall projects, employment created by FDI projects in Yorkshire and the Humber stood at 4,247 jobs in 2024, more than double the 2023 total (1,993). The West Midlands (4,926) and Scotland (4,330) were the only regions outside of London to secure more FDI-related jobs in 2024 than Yorkshire and the Humber.

The UK recorded 853 FDI projects in 2024, a 13% decline from 2023, making it Europe’s second-best-performing country for attracting inward investment. France ranked first in Europe in 2024 with 1,025 projects, a decline of 14% year-on-year. Europe as a whole recorded a 5% year-on-year decrease in FDI projects.

This continent-wide decline is believed to have been driven in part by relatively modest levels of economic growth in recent years, prompting investors to look towards more competitive global destinations such as Asia and the US.

Despite the broader national UK decline, the North of England as a whole recorded a 29% increase in FDI projects in 2024.

Manufacturing continues to play a significant role in driving FDI in the region

Software and IT Services has been the leading sector for attracting FDI projects to Yorkshire and the Humber over the last decade, although in 2024 the sector was ranked fifth with the region securing a total of four tech-related projects.

Over the last 10 years, Machinery and Equipment has been the second-most prevalent sector for Yorkshire and the Humber's FDI project generation, accounting for 11% of the region’s investment projects. In 2024, the sector was again ranked second with a total of nine projects.

The Agri-food sector, which includes companies across the food production and distribution supply chain, was Yorkshire and the Humber’s biggest driver of FDI projects last year, with a total of ten, up from just one in 2023, marking the sector’s highest number of FDI projects in Yorkshire and the Humber over the last decade.

Examining FDI by activity reveals that the region’s year-on-year rise in inward investment was driven in part by an increase in projects involving manufacturing. Yorkshire and the Humber attracted 24 manufacturing projects in 2024, more than double its 2023 manufacturing total (nine). Manufacturing was the most prevalent FDI activity attracted by the region last year. This was followed by business services (13 projects) and logistics (5 projects).

US continues to be leading origin of FDI in the region

The United States (US) has been the leading origin of Foreign Direct Investment projects into Yorkshire and the Humber over the last 10 years by a significant margin, accounting for more than a quarter (28%) of the region’s projects over the decade. This trend was even more pronounced in 2024, with the US being the origin of 40% of the region’s FDI projects.

The US was a proportionately larger origin of investment in Yorkshire and the Humber than it was for the UK in 2024, with the US contributing 21% of overall investment projects nationwide.

Over the last ten years, Germany has been the region’s second-largest origin of FDI projects with 11%, however this wasn’t the case in 2024, with Germany the source of only one project in Yorkshire and the Humber.

In 2024, the other countries that made up the seven largest origins for investment were India, Sweden, France, Ireland, Japan and the Netherlands. However, over the last decade, projects originating from Denmark and Switzerland have been more prevalent than those of Sweden and Japan.

Tim West, Leeds Office Managing Partner at EY, said: “Yorkshire and the Humber bucked the UK trend in 2024, with FDI projects in the region up by more than 50% year-on-year despite a national decline. The region’s strong performance was underpinned by its manufacturing prowess, which continues to shine brightly despite the impact of a range of economic headwinds. Meanwhile, FDI-related employment in 2024 was more than double the previous year’s figure, underscoring the tangible value that inward investment can bring to people across the region.

“Our survey highlights that access to a skilled workforce, the availability of partners and suppliers and the strength of local transport infrastructure are key criteria for global investors when considering locations outside of London. This should be encouraging for our region’s prospects, given its dynamic range of vibrant companies and its talented workforce. Looking ahead, continued close coordination between local and national policymakers will be vital in ensuring that the Yorkshire and the Humber region builds on its skilled workforce and makes strategic infrastructure improvements to maintain and enhance its appeal to global investors.”

Mixed national picture but North performs strongly

Greater London retained its position as the leading UK region for FDI in 2024, followed by Scotland.

However, most UK regions attracted fewer FDI projects in 2024 than they had in 2023. Greater London (-26%), Scotland (-5%), the West Midlands (-32%), the South East (-9%), the South West (-32%), the East of England (-36%) and Northern Ireland (-6%) all saw project totals decline year-on-year.

In contrast, regions across the North of England saw project numbers rise last year. As well as Yorkshire and the Humber, the North West (86 projects) and the North East (42 projects) both saw projects rise by 27% and 11% respectively.

The East Midlands (36 projects) and Wales (16 projects) were the only other two regions to attract a greater number of FDI projects in 2024 than they did in 2023.

Peter Arnold, EY UK Chief Economist, said: “Tech has been the consistent lead sector for UK FDI over the last twelve years, and London has continued to hoover up the lion’s share of digital projects. But the sector and activity mix outside London remains diverse, which could be an advantage for the UK in the years ahead. The prominence of manufacturing in the North West, logistics in the Midlands and R&D activity in the South East, alongside renewable energy opportunities in Scotland and the North East, means the UK has various hubs that could potentially lead Europe in the years ahead.

“Policymakers will need to determine how best to support these regional strengths while also fuelling those sectors that investors see as key drivers for UK investment in future, such as professional services and technology. The upcoming Industrial Strategy should provide opportunities to coordinate a nationwide approach to bolster and protect high-value sectors and activity. For example, elevated energy costs may present challenges for the North’s ongoing recovery in manufacturing, and enhanced energy security could help mitigate some of the impact.”

Investors motivated by grants and skills when considering locations outside London

Alongside an analysis of investment numbers, EY also conducted a survey comprising of interviews with a panel of 400 international investment decision-makers between January and March 2025.

When asked for the investment criteria they assess when considering whether to invest in a region outside of London, more than a third (37%) of respondents said that the availability of regional grants and incentives for investment was a key consideration. This was followed by the availability and skills of the local workforce (30%) and the availability of business partners and suppliers (28%).

Other important investment criteria included the strength of local business networks (24%) and the strength of transport infrastructure (21%).

​